Monthly Archives: August 2009

The NYT had two excellent pieces on this subject yesterday. Richard Thaler’s article is the best piece I have read on the public option. And he gives Republicans and Democrats alike some very good advice:

To the Republicans, I say this: If you can get real assurances that the public option has to break even, and that it will get no special deals from suppliers, let the Democrats have it but ask for concessions on tort reform in return. (That could actually save some money.) The resulting public plan will be too small to notice.

To the Democrats, I say this: If you want competition in health care, you won’t get it if the public option can make deals its competitors can’t. So either give the Republicans hard assurances that the public option would have to break even and not get special treatment, or, better yet, just give it up to ensure that some useful health care reform is passed. A public option is neither necessary nor sufficient for achieving the real goals of reform, and those goals are too important to risk losing the war.

And Sarah Lyall has a fine, balanced piece on what an American living in Britain makes of the NHS. Everything she says rings true to me, a Brit living in the United States.

The N.H.S. is great at emergency care, and great at pediatric care. My children have enjoyed thorough treatment for routine matters — vaccines, eye tests and the like. A friend who had cancer received the same drugs and the same treatment, I was assured, as she would have in the United States. When, heartbreakingly, she died, her family was not left with tens of thousands of dollars of outstanding bills, or with the prospect of long, bitter fights with hardened insurance companies.

But there are limits. Without an endless budget, the N.H.S. does have to ration care, by deciding, for instance, whether drugs that might add a few months to the life of a terminal cancer patient are worth the money. Its hospitals are not always clean. It is bureaucratic. Its doctors and nurses are overworked. Patients sometimes are treated as if they were supplicants rather than consumers. Women in labor are advised to bring their own infant’s diapers and their own cleaning products to the hospital. Sick people routinely have to wait for tests or for treatment.

The Obama administration had hoped that this month’s town hall meetings would smooth the way for healthcare reform. Things do not seem to be working out that way. Across the country, loud and furious protesters have turned up. They accuse the White House of wishing, among other things, to bankrupt the nation, destroy the American way of life and bring in “death panels” to mitigate the excessive healthcare demands of the elderly.

Unruly protest makes good television and is especially welcome in a slow month for news. The protesters have been dominating US newspapers and news programmes in recent days.

It is all a little misleading. Many who are sceptical about the Democrats’ plans have asked intelligent questions. But this is too dull for prime-time, and before you know it, intelligent questions bog you down in complex details. Better to make the protests the story.

The fractious debate over President Barack Obama’s efforts to reform US healthcare has provoked a transatlantic split, as some of his critics from the American right ridicule the UK’s National Health Service, which some people view as a possible model for the US.

David Cameron, leader of the UK’s opposition Conservative party, on Friday added his voice to that of Gordon Brown, the Labour prime minister, in defending the NHS from US criticism, saying Britons were proud of the service. Mr Brown’s intervention on the Twitter social networking site came as some Republicans used the NHS as an example of the potential pitfalls facing Mr Obama as the US president tries to push through a healthcare reform bill. What do you think about US healthcare reform? Would you rather be sick in the US or in the UK? Click on the “comments” button to join the debate.

The [Transportation] department has sent Continental Airlines a letter asking for details on Continental Express Flight 2816, which left Houston at 9:23 p.m. Friday but didn’t arrive at its destination in Minneapolis until after 11 a.m. Saturday.

In between, the small airliner spent nearly seven hours sitting on the tarmac in Rochester, where it had been diverted because of thunderstorms, before passengers were allowed to go inside an airport terminal. Two and a half hours after disembarking, passengers reboarded the same plane and were flown to Minneapolis.

The airline is claiming that the passengers had to stay “enplaned” because TSA officials had left for the night, meaning that nobody would be available to screen the passengers again before reboarding. They were finally allowed to get off next morning when the TSA officers arrived for work. Absurd? Of course. Another case of following procedures over a cliff. But never fear. The department is working on new procedures.

A civil exchange, at least. But not a very effective performance. He treated it as an election campaign event. The opening was thoroughly partisan: his first substantive remarks were an attack on the venality of the insurance companies, a theme to which he returned repeatedly. He banged the populist drum in other ways too. If this effort fails, he said, it will be because of the resistance of special interests. (Actually, it won’t.) They have blocked reform before, he said, and must not be allowed to do it again. To me, this is foolishly condescending to the voters who disagree with the proposed reforms on their merits: it says they are dupes.

Still, he successfully reset the message, as trailed earlier. He played down cost control, except when pressed by questioners to discuss the future of Medicare. (We will spend a lot less, he said, and get better results at the same time.) Moving the focus elsewhere is wise, since the bills have rather little to say on cost control, and this point is now well understood.

Instead, his main themes were the need to widen coverage and, especially, the benefits of reform for people who already have insurance–principally, that there will be new limits on out of pocket expenses (getting sick should not make you bankrupt) and that your coverage will not be denied in future because of pre-existing conditions. As I’ve mentioned before, this last point should have been front and centre from the start, but better late than never.

Unfortunately he’s still trying to argue that if you are happy with what you’ve got, nothing will change. This is neither true nor even plausible. For instance, services under Medicare would be affected by the new reimbursement regime. The public option would destabilise some private plans–and is intended to. People won’t just migrate at their own initiative to new plans because they find them preferable. Many will be migrated by their employers, whether they like it or not. This claim that nothing will change if you’re content has to go.

He was unusually clumsy now and then. What was he thinking, giving his second question to a child? And what was he thinking when he answered that question with a discussion of end-of-life counselling and an intended joke (I think) about switching off granny’s life support? I didn’t see many people in this overwhelmingly friendly audience laughing.

When he was asked about his earlier support in principle for single-payer, he said that the transitional difficulties would be too great. That seemed a tepid endorsement of the mostly private system that is actually being proposed. But of course the main problem is that he still cannot say with any precision what the plan is. He can assure the country of this and that, plausibly or otherwise, but there is still no finished plan to sell. Many of the questions were appeals for information. People are asking, what is going to happen? The president doesn’t know. He just knows he’s for it.

Democratic members of Congress are taking the case for health reform to a series of “town-hall meetings”. In many cases these have turned into brawls—and so far as most reporting is concerned, rage rather than the substance of the issues is now the story. Many protesters are hoping not to debate but to shut the meetings down. They carry posters of politicians with devils’ horns, or of Obama with a Hitler moustache. They claim the administration wants to bring in euthanasia, among other things. It is all very ugly.

There are valid and invalid criticisms of the protesters. A bogus criticism is the Democrats’ complaint that the protests are “orchestrated”. No doubt they often are. But what is wrong with that? Democrats have been known to orchestrate a thing or two. Progressive groups turn up for regular strategy consultations in the White House. What is that about, if not “orchestration”? Also, directed or not, the passion of the protesters is not synthetic. They are against these bills, and they are entitled to say so.

I’d go a little further in defending them. These town-halls are not really an exercise in consultation. The politicians are not asking their constituents, “What should we do about healthcare reform?” They are saying. “This is what we plan to do and why. Any questions?” The Democrats, after all, had hoped to get the whole thing done by now, no consultation required. This recess is an inconvenience not an opportunity. In that sense, the town halls are mainly for show. The politicians are not there to learn anything. I can understand the view that shouting at them is the only way to get their attention.

Of course, the notion that the administration plans euthanasia for sick retirees is insane—can anybody seriously believe this? And there are many other instances of deplorable and outlandish misinformation. But this does not mean that the proposed reforms give no grounds whatever for concern, as many liberals seem to believe.

In particular, the fear that standards of care for the elderly might fall has some justification. If stricter tests of cost effectiveness in health care are to be brought to bear—as they should be, in my view—spending unlimited sums on one or two low-quality end-of-life years will likely fail them. And the stricter rationing of treatments for the elderly is not a malicious fantasy of the conservative right. In systems like Britain’s NHS, it is standard operating procedure.

These are difficult issues. They have to be faced. What a pity this cannot be done in a civil way, with tolerance and mutual respect. In the US today, this is asking the impossible. The two sides don’t just disagree. They loathe each other. They would literally wish to see each other destroyed. It is hard to see how you get from here to any kind of consensus.

“Read my lips. No new taxes.” George Bush senior made that fatally memorable promise during his campaign for the White House. Later he saw that for the sake of the economy he would have to break it. When he did the right thing and went back on his word, he was vilified. It was a turning point in his presidency – his one-term presidency.

Not that Barack Obama needs reminding. He finds himself in exactly the same position. During his own run for the White House, he promised that taxes would not rise for families making less than $250,000 a year. If you are middle class, he said in his stump speech, “you will not see your taxes increased by a single dime. Not your income tax. Not your payroll tax. Not your capital gains tax. No tax”. Mr Obama knows the risk if he, too, breaks his word.

But he also knows he will have to. Higher taxes on the broad middle class would be needed even without Mr Obama’s long-term plans for healthcare reform, infrastructure spending and the rest. Factor those plans in, and the need is plain even on the administration’s own flattering arithmetic: its budget leaves an enormous long-term deficit even after the economy has returned to full employment. Make less rosy assumptions, and the hole is bigger still.

Friday’s figures showed an unexpected fall in the unemployment rate. Is the recession over? Possibly, explains James Hamilton, but it would be wise to reserve judgment for a while yet.

Perhaps the loudest cheering over the BLS report was because the unemployment rate improved from 9.5% in June to 9.4% in July. But let’s look at how the net flows behind that calculation break down. The BLS only counts you as “unemployed” if you both (1) don’t have a job and (2) have taken active steps within the last 4 weeks to try to find a job. According to the household survey from which the unemployment rate is constructed, there were 155,000 Americans on net who quit or lost their jobs in July but didn’t immediately look for a new job, so those people newly without jobs don’t contribute positively to a higher unemployment rate. And 267,000 Americans who reported themselves to be unemployed in June still weren’t working in July but had also stopped actively looking for a job, so they’re no longer counted as unemployed. That last development is the reason the unemployment rate went down. But given the current environment, it’s hardly appropriate to interpret the fact that many people have simply stopped looking for jobs as reflecting an improving economy. Unless we get much better employment reports in September and October than we did in August, the unemployment rate is sure to climb back up.

Don’t take my word for it. My friends will confirm that I’m married to a startlingly beautiful woman. I say this with all due modesty and not without regret. I recall a piece by Michael Lewis some years back about the drawbacks of being married to a model. (My wife is not a model but she could be if she weren’t so intelligent.) Poor lad, one thought, let me be the first to sympathise. But in fact he had a point. Now and then men who meet us take me aside to demand an explanation. “What the hell is going on here?” or words to that effect. Their astonishment, frankly, can give offence.

Anyway, doubtless seeing some merit in the consensus that she would be better off elsewhere, she is currently dodging rocket fire in the more congenial surroundings of Kabul. The job brings her into frequent, er, contact with muscular security officers and assorted high-testosterone adventurers, who see precious few women of ordinary looks, let alone knockouts like my wife. So as you can imagine I often ask for a word of reassurance. She is very sweet and patient about it.

On the occasion of my most recent tantrum, she said the competition is not as formidable as I might think. As one of her women friends, reviewing the local talent, put it: “The odds are good, but the goods are odd.”

Have you heard that before? I had not. What a brilliant apercu. It might be Australian, which would stand to reason. A no-nonsense people. I have been in situations where it fits the case perfectly. Perhaps it is common parlance, but if not it deserves to be.

Warmest congratulations to the new Supreme Court justice. An inspiring, remarkable, and distinctively American story, and undoubtedly a well-deserved appointment. Soon we’ll find out what kind of a justice she’ll be–and what her promises (made in their time by all the other ideologically committed justices of left and right) about strict political neutrality, and applying the law rather than making it, blah, blah, blah, will mean in practice.

As always Stuart Taylor of National Journal has something interesting and important to say on the subject. I was among the many who noted (with approval) Sotomayor’s statement that “American law does not permit the use of foreign law or international law to interpret the constitution”. Stuart’s new column points out that there may be much less to this than meets the eye.

It’s clear from Sotomayor’s post-testimony written answers, as well as from her April 2009 speech to the ACLU of Puerto Rico, that she would consider foreign court decisions — precedents, that is — “as a source of ideas… informing our understanding of our own constitutional rights.”

At the outset of her ACLU speech, Sotomayor said: “I always find it strange when people ask me, ‘How do American courts use foreign and international law in making their decisions.’ And I pause and say, ‘We don’t use foreign or international law; we consider the ideas that are suggested by international, foreign law.”

She added that “to the extent that we have freedom of ideas, international law and foreign law will be very important in the discussion of how to think about the unsettled issues in our own legal system” and endorsed the idea of Justice Ruth Bader Ginsburg “that, unless American courts are more open to discussing the ideas raised by foreign cases, by international cases, that we are going to lose influence in the world.”

This could be an extremely important issue, and it looks as though Sotomayor will be on the wrong side of it. The Ginsburg view that she endorses seems indefensible, if not downright bizarre, to me. The US increases its influence in the world by making its law conform more closely to foreign laws? Eh? (This reminds me of the idea that Britain would have more influence in the world once it submerged itself more thoroughly in Europe.) More important, what concern is it of the Supreme Court whether and to what extent the US influences other countries in the first place?

Clive Crook’s blog

This blog is no longer updated but it remains open as an archive.

I have been the FT's Washington columnist since April 2007. I moved from Britain to the US in 2005 to write for the Atlantic Monthly and the National Journal after 20 years working at the Economist, most recently as deputy editor. I write mainly about the intersection of politics and economics.

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